Would Easyleisure.com view the current economic conditions as an opportunity? [14 out of 18, 2001]

When assessing the current economic climate, Easyleisure.com would have to look at the business cycle trends and the competition. With reference to the case study, Easyleisure.com is currently in a market which has just been devastated by the ‘dot.com crash’. With regard to competition, their major competitor – ‘vitalhealth.com’ – has just gone belly-up “as the economy enters a recession”. [^]

In analysis, the business cycle goes through its ‘slump – boom’ phases approximately every 10-15 years. Easyleisure.com would deduce from this that a ‘slump’ will follow the current ‘recession’. This will impact on the business because consumers save their money, rather than spend it as redundancy fears increase. This would be viewed as a threat to the business. Easyleisure.com is currently the market leader, as they have survived the ‘crash’, and face no serious current competition. Easyleisure.com might like to consider cementing their dominance by increasing services/products offered as they strive to appeal to a wider audience. [^]

In evaluation, Easyleisure.com could arguably see the current economic climate as an opportunity. Although consumers will save money during the recession and slump cycle phases, they are in a strong long-term position as market leaders, without stiff competition. Although profits are likely to be low short-term, when the economy picks up they should achieve high profit margins in the absence of competitors. The recovery and boom phases could be seen as times when the company will attempt to expand and grow, as consumer spending increases, and turnover is regular. Easyleisure.com has already survived a major crash, and – with their large consumer base – future survival should be assured. [^]